With President Obama’s health care law putting the traditional insurance marketplace across the country into upheaval, one alternative that has grown in popularity is Christian health sharing, an approach among faith communities to share costs without being subject to the regulatory burdens and mandates of Obama’s law.

Medi-Share is a nationwide community of more than 47,000 Christians who follow the biblical model of sharing and paying each other's medical bills. Members commit to following healthy lifestyles based on Christian principles—such as not smoking, using drugs, drinking in excess, or having sexual relationships outside of marriage. Medi-Share members are legally exempt from the provisions of President Obama’s health care law.

Instead of monthly premiums, Medi-Share participants share in each other medical bills and pay, on average, 20 percent to 30 percent less for health care than those with traditional insurance, saving participants more than $600 million in health care expenses since 1993. With health insurance premiums expected to rise by as much as 40 percent over the next three years, more people are turning to health sharing as an alternative, says Larry Guyette, chief operating officer of Christian Care Ministry, which operates Medi-Share.

“This program is not for everyone. But our unique approach is how we’re able to protect our members and keep costs low,” he said.

Negotiated Payments to Providers

Guyette says members contribute an average of $170 per individual or $282 per family per month. When they experience a medical problem, they select a network provider. At the health care provider’s office, they show their Medi-Share ID card and the provider notifies Medi-Share. The provider sends the bill to Medi-Share, which then negotiates and possibly discounts the bill.

Afterwards, Medi-Share publishes the eligible medical bill for sharing. Medi-Share transfers the sharing funds directly between member accounts and issues a check to the provider drawn on the member's ACCU (America’s Christian Credit Union) account.

“We don’t think members should have to pay for illnesses related to smoking, drug abuse, or abortion. We also have a list of preexisting conditions we don’t cover—cancer, for instance. We also don’t cover routine needs, like your yearly physical, or elective procedures like face lifts. We believe it is the member’s responsibility to cover things like that. What we do cover is the unexpected, such as a car wreck,” Guyette said.

‘Passing the Plate’

Although Medi-Share can help Christians manage the costs of health care, it is not insurance. Resources are shared directly between members—there is no pooling of funds, and the program can’t legally compel its members to help one another with their bills. Thus, Medi-Share does not offer the legal protections you’d expect from regulated insurance companies, notes Spencer Harris, a health care policy analyst with the Texas Public Policy Foundation.

“Medi-Share is up-front with you that they’re not providing health insurance. What they are is a faith-based organization you can contract with when you’re in difficult circumstances due to health reasons. Medi-Share is akin to passing the plate at church on Sunday—only here they’ve expanded the scale,” Harris said.

Not an Insurance Program

Linda Gorman, director of health care policy at the Independence Institute, says the association is similar to the fraternal organizations that were so important in the late 19th and 20th centuries.

“They have deductibles and lifetime limits like commercial policies. The limit is $1 million a year and $5 million lifetime, $50,000 during the first month of membership. There are separate limits for preexisting conditions unknown when person joined,” Gorman said.

Gorman notes the policy is canceled if there is any tobacco use, substance abuse, evidence of “sexual relations outside of traditional Christian marriage,” or participation in activities that “represent a willful disregard for personal safety.” If you gain too much weight, you have to make “significant progress toward the established goals” of losing it, she said.

“All kinds of things require precertification. There’s no treatment for sexually transmitted diseases except for rape, no behavioral or mental health care, no routine and preventive care,” Gorman said. “This might be a model that works for a lot of people if adapted to a more traditional insurance approach. It’s too bad that ObamaCare essentially stops this kind of experimentation” in the overall marketplace.

Alternative for Protection

Tarren Bragdon, president of the Foundation for Government Accountability, says Medi-Share serves a purpose for faith-based populations looking for an alternative to private health insurance.

“When you enroll in Medi-Share, you are basically the same as a cash-paying individual whenever you go to the doctor. However, if you are going into the hospital for a major medical procedure, you make your case and the other members share your bills,” he said.

Bragdon says someone laid off from their job or starting a small business might find this a good alternative to private health care, and members of the clergy might use it for many years.

“Private insurance is not a one-size-fits-all solution for everyone. Programs like Medi-Share are real alternatives for individuals looking for protection against financial ruin due to a catastrophic health incident,” Bragdon said. “Just as you see other faith-based organizations competing with private relief organizations, Medi-Share is a faith-based alternative to private insurance. I think it fills a useful niche for the people availing themselves of this service. That’s how the market works.”